Arbeitspapier
Economic recommendation with surplus maximization
A prime function of many major World Wide Web applications is Online Service Allocation (OSA), the function of matching individual consumers with particular services/goods (which may include loans or jobs as well as products) each with its own producer. In the applications of interest, consumers are free to choose, so OSA usually takes the form of personalized recommendation or search in practice. The performance metrics of recommender and search systems currently tend to focus on just one side of the match, in some cases the consumers (e.g. satisfaction) and in other cases the producers (e.g., profit). However, a sustainable OSA platform needs benefit both consumers and producers; otherwise the neglected party eventually may stop using it. In this paper, we show how to adapt economists' traditional idea of maximizing total surplus (the sum of consumer net benefit and producer profit) to the heterogeneous world of online service allocation, in an effort to promote the web intelligence for social good in online eco-systems. Modifications of traditional personalized recommendation algorithms enable us to apply Total Surplus Maximization (TSM) to three very different types of real-world tasks - e-commerce, P2P lending and freelancing. The results for all three tasks suggest that TSM compares very favorably to currently popular approaches, to the benefit of both producers and consumers.
- Language
-
Englisch
- Bibliographic citation
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Series: WZB Discussion Paper ; No. SP II 2016-502
- Classification
-
Wirtschaft
- Subject
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Total Surplus Maximization
Online Service Allocation
Computational Economics
Recommendation Systems
Web-based Services
- Event
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Geistige Schöpfung
- (who)
-
Zhang, Yongfeng
Zhao, Qi
Zhang, Yi
Friedman, Daniel
Zhang, Min
Liu, Yiqun
Ma, Shaoping
- Event
-
Veröffentlichung
- (who)
-
Wissenschaftszentrum Berlin für Sozialforschung (WZB)
- (where)
-
Berlin
- (when)
-
2016
- Handle
- Last update
-
10.03.2025, 11:43 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Zhang, Yongfeng
- Zhao, Qi
- Zhang, Yi
- Friedman, Daniel
- Zhang, Min
- Liu, Yiqun
- Ma, Shaoping
- Wissenschaftszentrum Berlin für Sozialforschung (WZB)
Time of origin
- 2016
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